CASE DIGEST:

Serona v. CA
G.R. No. 130423, November 18, 2002

FACTS:
Leonida Quilatan delivered pieces of jewelry to Virgie Serona to be sold on commission basis. By
oral agreement of the parties, petitioner shall remit payment or return the pieces of jewelry if not
sold to Quilatan, both within 30 days from receipt of the items.

Serona failed to pay. Thus, Quilatan required her to execute an acknowledgment receipt
indicating their agreement and the total amount due, to wit:

Ako, si Virginia Serona, nakatira sa Mother Earth Subd., Las Pinas, ay kumuha ng mga alahas
kay Gng. Leonida Quilatan na may kabuohang halaga na P567,750.00 para ipagbili para ako
magkakomisyon at ibibigay ang benta kung mabibili o ibabalik sa kanya ang mga nasabing alahas
kung hindi mabibili sa loob ng 30 araw.

Las Pinas, September 24, 1992.

The receipt was signed by petitioner and a witness, Rufina G. Navarette.

Unknown to Quilatan, Serona had earlier entrusted the jewelry to Marichu Labrador for the latter
to sell on commission basis. Serona was not able to collect payment from Labrador, which caused
her to likewise fail to pay her obligation to Quilatan.

Subsequently, Quilatan sent a formal letter of demand to Serona for failure to settle her obligation.
Quilatan executed a complaint affidavit against petitioner before the Office of the Assistant
Provincial Prosecutor. Thereafter, an information for estafa under the RPC was filed against
petitioner and raffled to the RTC-Las Pinas. Petitioner pleaded not guilty to the charge.

Quilatan testified that petitioner was able to remit P100,000.00 and returned P43,000.00 worth of
jewelry; that at the start, petitioner was prompt in settling her obligation. However, subsequently
the payments were remitted late; that petitioner still owed her in the amount of P424,750.00.

Serona admitted that she received several pieces of jewelry from Quilatan and that she indeed
failed to pay for the same. She claimed that she entrusted the pieces of jewelry to Marichu
Labrador who failed to pay for the same, thereby causing her to default in paying Quilatan. She
presented handwritten receipts evidencing payments made to Quilatan prior to the filing of the
criminal case.

Serano argues that the prosecution failed to establish the elements of estafa as penalized under
Article 315, par. 1(b) of the Revised Penal Code. In particular, she submits that she neither abused
the confidence reposed upon her by Quilatan nor converted or misappropriated the subject
jewelry; that her giving the pieces of jewelry to a sub-agent for sale on commission basis did not
violate her undertaking with Quilatan. Moreover, petitioner delivered the jewelry to Labrador under
the same terms upon which it was originally entrusted to her. It was established that petitioner
had not derived any personal benefit from the loss of the jewelry. Consequently, it cannot be said
that she misappropriated or converted the same.

Marichu Labrador confirmed that she received pieces of jewelry from petitioner worth
P441,035.00. She identified an acknowledgment receipt signed by her and testified that she sold
the jewelry to a person who absconded without paying her. Labrador also explained that in the
past, she too had directly transacted with Quilatan for the sale of jewelry on commission basis;
however, due to her outstanding account with the latter, she got jewelry from petitioner instead.
RTC found Serona guilty of estafa. After appeal, the CA affirmed judgement of conviction.

ISSUE: Whether or not there was estafa committed and abuse of confidence on the part of
petitioner in entrusting the subject jewelries to her sub-agent for sale on commission to
prospective buyers.

HELD:
No, the law on agency in our jurisdiction allows the appointment by an agent of a substitute or
sub-agent in the absence of an express agreement to the contrary between the agent and the
principal. In the case at bar, the appointment of Labrador as petitioner sub-agent was not
expressly prohibited by Quilatan, as the acknowledgment receipt, does not contain any such
limitation. Neither does it appear that petitioner was verbally forbidden by Quilatan from passing
on the jewelry to another person before the acknowledgment receipt was executed or at any other
time. Thus, it cannot be said that petitioners act of entrusting the jewelry to Labrador is
characterized by abuse of confidence because such an act was not proscribed and is, in fact,
legally sanctioned.

In the case at bar, it was established that the inability of petitioner as agent to comply with her
duty to return either the pieces of jewelry or the proceeds of its sale to her principal Quilatan was
due, in turn, to the failure of Labrador to abide by her agreement with petitioner. Notably, Labrador
testified that she obligated herself to sell the jewelry in behalf of petitioner also on commission
basis or to return the same if not sold. In other words, the pieces of jewelry were given by petitioner
to Labrador to achieve the very same end for which they were delivered to her in the first place.
Consequently, there is no conversion since the pieces of jewelry were not devoted to a purpose
or use different from that agreed upon.

Similarly, it cannot be said that petitioner misappropriated the jewelry or delivered them to
Labrador without right. Aside from the fact that no condition or limitation was imposed on the
mode or manner by which petitioner was to effect the sale, it is also consistent with usual practice
for the seller to necessarily part with the valuables in order to find a buyer and allow inspection of
the items for sale.

However, petitioner is not entirely free from any liability towards Quilatan. The rule is that an
accused acquitted of estafa may nevertheless be held civilly liable where the facts established by
the evidence so warrant. Then too, an agent who is not prohibited from appointing a sub-agent
but does so without express authority is responsible for the acts of the sub-agent. Considering
that the civil action for the recovery of civil liability arising from the offense is deemed instituted
with the criminal action, petitioner is liable to pay complainant Quilatan the value of the unpaid
pieces of jewelry.